As alluded to in past articles, its pretty clear that many webmasters enter the realm of running an arcade site with the primary goal of making money.
While becoming a successful arcade webmaster isn’t exactly a cake-walk, it can be more ‘beginner-friendly’ than other avenues, so when writing to this blog I think its important to cover some of the bare basics that some of the more experienced webmasters out there have embedded so deeply in their consciousness that they take for granted the fact that not everyone is aware of them.
First off, monetization. Sure, you’ve heard that you can make money from this “internet-thing” and you want a piece of the pie… but where to start? Before we begin looking at specific companies, I think its best that we examine the different types of advertising streams you could be dealing with.
PPC Advertising
‘Pay-per-click’ advertising, also known as ‘CPC’ - ‘Cost-per-click’ (although this is a term more relevant to the people buying the ads rather than publishing them). in a nutshell, this is as it sounds. An advertiser agrees to pay a certain amount for every person who clicks their ad, and in displaying that ad on your site, that cash makes its way to you. In practice its a bit more complicated than that, but for now we’re keeping it bare-bones simple.
CPM Advertising
‘Cost per mille’ (”mille” being the latin for “thousand”… or if you want to be fancy, in the UK the ‘M’ stands for the roman numeral for ‘thousand’) - basically meaning ‘Cost per 1,000 impressions’. An ‘impression’ is a single ‘viewing’ of a particular ad by a website visitor so, if one person comes to your site and views 4 pages, and each page has an ad on, thats 4 impressions. With CPM, an advertiser will specify how much they are willing to pay for every 1000 views of their ad, and this in turn breaks down to CPI (cost per impression). So, if an ad has a CPM of $1.00, its CPI is $0.001 - if you show this ad on your site and it gets 500 impressions, then you earn $0.50
CPA Advertising
‘Cost per action’ advertising, as inferred by its name, requires a visitor to take some form of action on the website to which the ad links. This could range from providing information, to signing up or subscribing to a service, to making an actual purchase. When the required process is completed, you receive a commission/fixed payment for that lead.
There are more forms of advertising that could be used on your arcade website or, indeed, your other websites; however as we’re starting with the very basics, we’ll limit discussion to those three for the time being.
So, now you know the main forms of advertisement schemes that you can publish on your website, which ones should you focus on? Which will earn you the most money? Well, in the majority of cases, the amount of money earned has a direct correlation to what is required of the person “experiencing” the ad when visiting your website. With CPM, all a visitor needs to do is view the ad; with CPC, they view it, and then click it; with CPA, they view it, click it, and then follow through with the offer. So, it makes sense that the more steps that are involved, the more money that is made by the publisher; as such, CPA tends to make more, followed by CPC, followed by CPM.
Does this mean that you should use CPA ads on your site? Well, on the front of it, this seems like the logical decision. The issue, however, is with the success/conversion rate. As you’d imagine, “convincing” a visitor to complete that entire process is a lot harder than convincing them just to click an ad; so many people choose to go with CPC/PPC. Obviously CPM is a lot easier, but its pay rates can be low, and as such CPC/PPC proves to be a solid middle-ground.
This is not to say that either CPM or CPA are bad things, far from it; what it comes down to is that less people are likely to complete CPA offers, but when they do, you’ll get a nice return; while on the flip-side your visitors don’t have to do anything for you to make money from CPM, but CPM doesn’t pay particularly well.
CPA and CPM may become much more lucrative options a little later down the line however when starting out, most people will advise you to stick with CPC/PPC.
In the next article in this series focusing on arcade monetization, we’ll look at specific companies for the above three revenue streams, but if you can’t wait that long, let me point you in the direction of Google Adsense, the one place you can be guaranteed that almost every webmaster out there would recommend. They are, without question, the leading CPC/PPC advertising provider out there (and they also dabble in CPM and CPA), so if you’re going to try anything, try them first.
